AXA Investment Managers-Real Assets (AXA IM)1 and BlackRock Real Estate have sold a large prime office building in the City of London, which they jointly developed and let, for around £220m (€281m).
The property, 6 Bevis Marks, has been sold to one of Citi Private Bank’s private clients, the companies said.
The building was purchased in a 50:50 joint venture in 2011 and now has 174,550 sqft of office, retail and ancilliary space. It includes a basement, ground and 15 further floors, as well as a roof garden under an architecturally notable canopy.
Neither AXA IM nor BlackRock would disclose more details of the buyer or the original purchase price of the undeveloped asset.
Huw Stephens, head of UK transactions at AXA IM, said: “Having completed this project’s acquisition in 2011, we made the decision to press ahead with a large non pre-let development at a time when there was virtually no new construction being commenced in the City of London.”
Less than three years later, he said, the partners had produced a new grade-A office building in a prime City location into a market in which demand had returned, but where supply was still at historic lows.
“The building is now almost fully let and we have been able to complete an exit of what is now a trophy asset at an attractive price which provides a strong return for our clients,” Stephens said.
Having been completed in 2014, the building was let to “a range of strong tenants”, with a weighted-average unexpired lease term of over 10 years, the parties said.
They said the property has a BREEAM ‘excellent’ rating, and has good transport links, being 200 metres from Liverpool Street Station.
AXA IM said the UK was still one of its key real estate markets and since the beginning of 2009 had completed more than £6.8bn of deals in London, including the purchase of 22 Bishopsgate on behalf of a consortium of international investors.
Liam Le Roux, vice president within BlackRock’s UK real estate business, said the firm’s ability to get an attractive price for 6 Bevis Marks, despite market volatility in the run-up the the UK referendum, said a lot about the quality of the building and its tenants.
“The UK is an important strategic market and we are actively pursuing new value add opportunities across a number of sectors,” he said.
Cushman and Wakefield and JLL acted on behalf of the sellers.